The central government may soon announce a hike in dearness allowance (DA) for central government employees. According to reports, the announcement may be made in the last week of September or the first week of October.
Last year, the increased DA hike was announced in the first week of September. This time the government is hoping to increase DA by 3-4 percent from July 1, 2024.
In March 2024, the government has increased the dearness allowance by the 4 percent to 50 percent. Along with this, dearness relief (DR) was also increased by 4 percent.
Dearness allowance is given to central government employees, while dearness relief is for pensioners. DA and DR are effective twice every year in January and July.
Will central employees get COVID-19 DA arrears
In the recent monsoon session of Parliament, Minister of the State for Finance Pankaj Choudhary in Rajya Sabha also said that the government is seriously considering the possibility of the releasing 18 months of DA and DR arrears that had been withheld during the serious COVID-19 pandemic.
When asked if the government is considering releasing 18 months’ dearness allowance for central government employees and pensioners, he categorically said “no”.
Will DA above 50% be merged with basic pay
According to experts, if dearness allowance exceeds 50 percent, it will not be merged with basic pay. It will remain that way till the formation of the 8th Pay Commission. Instead of merging, there is a provision for an increase in allowances like HRA when DA exceeds 50 percent.
When will the 8th Pay Commission be formed
Central government employee unions have demanded the formation of the 8th Pay Commission but the government currently has no proposal for its formation.
Minister of State for Finance Pankaj Choudhary said in a written reply in the Rajya Sabha on July 30, “Two representations have been received for the formation of the 8th Central Pay Commission in June 2024.
The government currently has no proposal on this.” The 7th Pay Commission was constituted in February 2014, and its recommendations were implemented from 1 January 2016.
Usually, the government constitutes a pay commission every 10 years to revise the salaries of government employees.
How does the government decide DA hike
The increase in DA and DR is decided based on the percentage increase in the 12-month average of the All India Consumer Price Index (CPI-IW). The government revises allowances every year on 1 January and 1 July, but usually, the decision is announced in March and September/October.